Thanks for the pointer. Neither of these guys are fools and yet they both come up with an "Avoid".
https://******.com.au/media/the-call-friday-8th-december?videoId=33549Let's pick it apart, the good and the bad. My response in
italic.
Nadine: "we've got these electric little... vehicles, for lack of a better term".
Yep, VMT is an EV business, that is the term!Claude:
One of the oldest listed Chinese businesses on ASX. Commends its longevity.
Charles is a tenacious bugger, don't write him off"That subset [China on ASX] has been very poor."
Fair observation, but that's a broad category, not a stock, Vmoto can buck the trend. YAL has surprised people too"Big customers in China".
Fact check on that one?"Rules about how a company could get cash from China to Australia. .. Can you get that cash as a dividend back to Australia? that's the question"
I concur on this one. This is one of my concerns with Vmoto. China is a very regulated economy, subject to bizarre whims of its leadership, and not a close friend to Australia In 10yrs, shares on issue have more than doubled.
I dont like that either but not uncommon in capital-hungry small caps.Long term, on a hiding to nothing.... I would not have anything to do with it
Luke:
Notes that Vmoto manufacture in china but sell to Europe, Asia, Sth America.
He gets it. Funds don't need to go to China, can be held here. I wish we knew more actually on where the money is held.Just $5mil on Plant Property & Equip on the balance sheet. 50/50 owned in a JV.
Can anyone shed light on that $5mil comment Massive Pull back. There was probably a Covid pull forward of Consumer Discretionary purchases - these guys are electric scooters- 3rd quarter update, sales were down 58% on last year.
I dont think of VMoto as typical "consumer discretionary" in emerging markets. And "electric scooters" gives the wrong impression. Vmoto sell transportation utility more than toys. Raised capital despite having $28mil in the bank and saying 3rd quarter was cashflow positive.
Fair critisicm. The whole factory raise has been weird. Im not 100% comfortable with it either.Too many question marks. Avoid.
Charles and team have got some work to do to win over the mainstream ASX investment community. Vmoto will be niche and low PE for a while yet even if successful.
(20min delay)